Windows XP To Be Available Another 5 Months

In the latest sign of what appears to be growing trouble for Windows Vista, Microsoft has decided to keep its forerunner, Windows XP, in sales and OEM channels for another five months.

Microsoft announced the move on its Website Thursday. XP, scheduled to be taken off shelves and out of OEMs' hands next January, got a reprieve until June 30, 2008. By that time, Vista will have been out for almost 18 months.

Microsoft tried to put the best face possible on the news. Mike Nash, vice president of Windows Product Management, said in a press release that customer feedback drove the decision.

"Although our research with customers before and since launch has reaffirmed our belief that the previous plan to offer Windows XP through Jan 2008 would address the needs of most customers, we did get clear feedback that there was a set of customers who needed a bit more time. Feedback from our OEM partners and from customers is that the June 30, 2008 date will address those needs," Nash stated in the release.

Nash continued to tout Vista's license sales, but for the first time publicly, Microsoft admitted that things are not going as hoped. "With more than 60 million licenses sold as of this summer, Windows Vista is on track to be the fastest-selling operating system in Microsoft's history. And while many large businesses are moving incredibly fast to Windows Vista ... we are committed to helping customers of all sizes with the transition. Some need more time, and we understand and respect that," Nash said in the statement.

The "60 million" license figure is one Microsoft has trotted out repeatedly to show Vista's popularity. In May, Chairman Bill Gates announced that 40 million licenses had been sold, followed by the 60 million figure by Microsoft COO Kevin Turner in July. Despite the license sales figures, though, evidence continues to mount that there is broad dissatisfaction with Vista, dissatisfaction reflected in the continued -- and perhaps increasing -- growth of XP, a six-year-old OS.

For instance, in July Microsoft CFO Chris Liddell said that the company changed its revenue forecast from its desktop OSes in Fiscal Year 2008, revising Vista's revenue down from 85 percent to 78 percent, and XP's revenue up from 15 percent to 22 percent.

There were warning signs in the sales channel even before that. Last April, Dell decided to re-offer XP on six different laptop and desktop computer models, citing customer demand. Then in August, Fujitsu said it will begin including an XP disc with laptops and desktops.

Market research firms noticed the problems. Several prominent ones, including Gartner, In-Stat and NPD, reported on the relative softness of Vista sales. In a late June press release, Gartner analyst George Shiffler stated that "The release of Microsoft Windows Vista operating system at the end of January has, so far, failed to stimulate the market in the way many hoped."

Another ominous sign came in August, when Microsoft announced it was running out of XP product keys due to continuing strong sales. Following on the heels of that was the recent news that over the summer, Redmond quietly made process changes that made it easier to downgrade from Vista to XP. Some of the world's biggest OEMs, including Dell, Hewlett-Packard, and Lenovo, are taking advantage of the program.

Microsoft is also continuing to improve XP, announcing at the end of July that it's working on XP SP3, for release sometime in the first half of 2008. The company has yet to update that timetable.

Meanwhile, Vista continues to suffer from a poor perception industry-wide, at least some of which is justified. In the beginning, much of it had to do with application compatibility. Just 650 applications enjoyed "Works with Vista" or "Certified for Vista" recognition upon release. Although the situation has improved markedly since its launch, there are still numerous complaints about hardware and specialized business application compatibility.

Add to that problems with User Account Control (UAC), a security technology that assaulted users with endless pop-up boxes asking for permission to do basic tasks, and increased hardware requirements to make use of the Aero graphical interface, and the reasons behind Vista's sluggish sales become clearer. Combined with the familiarity users have with XP, and that OSe's stability and broad compatibility, it may not be so surprising after all that Microsoft is looking for ways to extend XP's freshness date.